Del Taco Restaurants, Inc. Announces Preliminary Unaudited Fiscal Fourth Quarter and Fiscal Year 2020 Sales Results

Del Taco Restaurants, Inc. (“Del Taco” or the “Company”), (NASDAQ: TACO), the second largest Mexican-American quick service restaurant chain by units in the United States, today reported preliminary unaudited fiscal fourth quarter and fiscal year 2020 sales results for the 16 and 52 week periods ending December 29, 2020. The Company also provided a liquidity and share repurchase update and announced that its Board of Directors has authorized the initiation of a quarterly cash dividend.

Management Commentary

John D. Cappasola, Jr., President and Chief Executive Officer of Del Taco, commented, “We are very pleased to report a system-wide comparable restaurant sales increase of 3.8% during the fourth quarter consisting of positive results at both company-operated and franchised restaurants. We are proud of our restaurant teams, franchisees and support center staff for providing our guests great food, great value, and great experiences that drove fiscal 2020 overall satisfaction scores to record levels while navigating a challenging pandemic related operating environment.”

Cappasola continued, “Looking ahead to 2021, along with our five drivers of sales acceleration, we are excited by the recent debut of our Fresh Flex prototype. This bold new prototype has been very well received and we believe it will help attract new franchisees to better position us for accelerated long term system growth. It will also play an integral role in our multiple year remodeling program designed to contemporize the fleet and drive returns.”

Cappasola concluded, “The decision by our Board to initiate a quarterly cash dividend reflects Del Taco’s ongoing commitment to deliver value to our shareholders and is consistent with our strategy to drive system-wide new unit growth led by franchising. Our strong operating cash flow enabled over $34 million of aggregate debt reduction plus share repurchases in 2020. At this time, we believe our balance sheet is healthy and our core business is well positioned for average unit volume growth, strong margin performance and continued cash flow generation. These factors support an expanded return of capital to shareholders, a disciplined investment strategy to grow the Del Taco brand primarily through accelerated franchise growth while furthering our remodeling program and capital allocation to other sales, productivity and technology initiatives.”